Image source @ Visual China
Wen | Xin Entropy, author | Jiarong, editor| Yi page
The popularity of bank cards made the 1980s an era of "one card in hand, I have it in the world". Entering the hotel and restaurant, taking out the bank card to swipe the card to spend, at that time it was a grand gesture. With the prevalence of mobile payment, the status of "swiping" is different from the past.
In October 2003, Alibaba launched Alipay, which became an important moment in the history of mobile payment. Prior to this, e-commerce was just an information platform and it was difficult to make transactions. With the expansion of Alipay, the gold rush era of mobile payment has begun, so that there is a passage in the anecdote that "ten richest people, nine do payment".
However, at present, it is not only the payment dispute of the richest man, but also the entry of mobile phone manufacturers such as Apple and Huami OV, which has spread into a "soft and hard scuffle" in the new era. Recently, Huawei Pay launched huawei wallet, which means that in addition to Huawei Pay, Huawei has taken another official step in the field of payment. As early as the 2021 Huawei Developer Conference, participants can use Huawei payment to scan the code to purchase tickets.
At present, the business covers Huawei-based applications and some third-party applications, including Huawei Music, Huawei Video, Huawei Reading, Mango TV, Youdao Cloud Notes, PP Video, etc., and supports binding to more than 160 banks such as Bank of China and China Construction Bank. This is also the first big move on payment after Huawei officially obtained a payment license last year.
With Huawei's growth in the field of payment, the scuffle between software and hardware manufacturers seems to have sounded the horn again.
In fact, in third-party mobile payment, compared with the software-based payment players led by Alipay and WeChat, players based on hardware ecology such as Apple and Huawei, backed by powerful hardware facilities, have not made a splash at present. However, although it is too early to divide Alipay and WeChat, Huawei Payment may not be here. As the boundaries between mobile payment platforms blur, the endgame has not yet arrived.
Hardware-based, stuck in hardware
Mobile phone manufacturers layout payment, it can be said that there are many "talents".
On the one hand, the foothold in the mobile phone market allows these players to have a large enough user scale, especially the head players. For example, Apple, Huawei and Xiaomi, which have now entered the payment game, have all won the minds of a large number of consumers in the hardware track, and then won the payment license. Every time a phone is sold, it means that there is one more potential user in terms of payment.
On the other hand, in addition to the pool of potential users, the hardware support of mobile phone players also provides a big advantage for them to break into the mobile payment position. For example, most mobile phones are currently equipped with NFC functions in order to support UnionPay mobile phone flash payment. Compared with Alipay and WeChat, which must be connected to the Internet to scan the code, contactless and network-free NFC is not only faster but also more convenient.
However, this is no longer the golden era of mobile payment everywhere, after the formation of consumer habits, conversion costs are getting higher and higher, and resources and users continue to gather to the industry oligarchy.
Relevant data show that since 2016, the combined market share of Alipay and WeChat Tenpay has remained above 90%. According to Ai Media Consulting's "2021 China Mobile Payment Industry Research Report", as of June 2021, the scale of domestic mobile payment users reached 872 million, of which 86.3% used mobile payment.
At present, with the strong attack of the state-endorsed digital yuan, as a legal tender issued by the central bank, it solves users' concerns about the security of mobile payments and can also realize offline payment. As of October last year, the digital yuan "with a golden spoon" had reached 140 million personal wallets after one year of opening up.
The more obvious advantages of mobile phone manufacturers are somewhat unsatisfactory under the siege of the three, not to mention the attack of e-commerce payments such as Jingdong Payment, Meituan Payment and Douyin Payment. Although Apple launched Apple Pay in China in 2016, Huawei and Xiaomi also launched Huawei Pay and MI Pay in the same year. However, unlike the four parties in the mobile phone market, three years later, in the iResearch "2019 Q1 China Third-Party Mobile Payment Market Size Transaction Share" report, even Suning Pay has a market share of 0.2%, and the three brands can only be classified as "other" with some payers accounting for a total of 1.7%.
It benefits from hardware, and it is also at the mercy of hardware.
For mobile phone manufacturers that expand the potential payment user pool based on mobile phone consumers, they are also facing the problem that the replacement cycle of China's mobile phone market has been nearly 30 months and the shipment volume has also fallen sharply. According to the "February 2022 Domestic Mobile Phone Market Operation Analysis Report" released by the China Academy of Information and Communications Technology, the shipment of mobile phones in the domestic market during the period fell by 31.7% year-on-year.
Taking the NFC basic payment function of mobile phone manufacturers as an example, industry insiders have said that compared with the cost of the NFC industry chain and the complexity of installation, the cost of using the two-dimensional code is lower, and not all mobile phone models are currently online NFC functions, especially entry models.
China Mobile Terminal Lab has pointed out that the lower the price segment, the more users pay more attention to the price, and the replacement cycle is relatively longer. This also puts forward higher requirements for how mobile phone manufacturers can popularize NFC technology in the face of various cost problems. In addition to the NFC hardware technology of the restricted mobile phone itself, it is also limited by the number of devices such as POS machines of the payment terminal, which further limits the scope of merchants that support NFC functions, and both are indispensable.
The payment ecology of mobile phone manufacturers is rooted in hardware, and if the hardware ecology is weak, the payment ecology that grows in this soil will also be hit. For software payment manufacturers that are not limited by hardware barriers such as mobile phone systems and mobile phone models, they can "grow wildly".
The so-called "ecology of the world", in terms of the integrity of the payment ecology, Alipay has long grown from an early payment tool to the current financial ecology around the three major changes in financial management, insurance and micro-loans, and has done a private social network to increase stickiness; WeChat backs up to a huge social traffic pool, although the payment function is later than Alipay online, it has long formed a rivalry trend; Meituan, JD.com, Pinduoduo and Douyin have also formed a closed loop of payment transactions with the help of e-commerce. However, the payment function of mobile phone manufacturers is slightly monotonous, and the current scope of application is too narrow.
At present, several major mobile phone players are fighting their own battles in the field of payment, and it seems that the noisy scene is difficult to hide the fact that no mobile phone manufacturer has really run out of the payment track. In the future, there may be more mobile phone manufacturers' payment wheels slowly setting sail, but the road ahead is still long.
It is called the payment scenario, which is actually an ecological layout
Even if it is difficult to share the payment cake, players based on the hardware ecology are not just doing useless work, but have a deeper layout behind it.
The current mobile phone manufacturers, the ambition has long been more than the reclamation of mobile phones this land, but to expand the battlefield to AloT, in an attempt to enhance user stickiness by occupying more scenes. In their respective ecosystems, the payment business as a financial infrastructure is an important part of the ecosystem that can form a stronger software and hardware ecosystem.
When it comes to capital security and user information security, the risks of payment business should not be underestimated. But it is the nature of a businessman to seek profit. If there is no greater value, the payment business will not become a feast.
In the view of Wang Pengbo, a senior analyst in the financial industry of Broadcom Consulting, the value of the payment business can be subdivided into compliance, data and finance.
It said in the interview: "The payment business has several aspects of value, the first is to solve the compliance problem, there is no payment license to do the platform to face the second clearance and other directions of doubts, the second is that after the compliance problem is solved, the payment license can help the platform integrate the business ecology and improve the business chain." In terms of data, it can no longer be subject to external institutions and can get first-hand transaction data; in terms of finance, relevant value-added services can be carried out, and supply chain finance and other businesses can be further derived. ”
Essence Securities also believes that the construction of their own payment channels by Internet head enterprises will also help enterprises reduce the channel fees generated by using third-party payments. Especially for the head of the Internet, the payment channel fee is very considerable.
An industry insider once pointed out that Apple's launch of Apple Pay first seized an important part of the entrance to offline services, "From the perspective of HealthKit and HomeKit and CarPlay proposed by iOS8, Apple's ambitions are by no means more than Apple Pay." "Compared with Apple Pay, Apple's ecosystem is the core.
Apple currently has not obtained a payment license in China, and can only complete the closed loop through cooperation with UnionPay and third-party payments. However, Xiaomi and Huawei may not be satisfied with just being a "pipeline", and they laid out payment licenses in the early years. In 2013, Xiaomi established Xiaomi Payment Technology Co., Ltd., and three years later obtained a payment license.
Although Su Jie, president of HUAWEI CLOUD Service Department, has previously said to the outside world: "An enterprise must have its own sense of boundaries and not apply for a license, because that is not what we are good at." In April last year, Huawei also obtained a mobile payment license by acquiring 100% of the equity of Xunlian Zhifu, becoming the second mobile phone manufacturer to have a payment license after Xiaomi.
Later, it was reported that Huawei was recruiting mobile payment service engineers, mobile payment financial product managers, e-commerce payment product architects, e-commerce payment risk control product managers, etc., so the market speculated that Huawei wanted to enter the payment market.
In this regard, Cao Chong, president of the global financial business department of Huawei Enterprise BG, publicly responded at that time: "Huawei currently has no plans to enter the payment market. He also said that in the financial sector, Huawei's business core is still to use ICT technology to help and empower financial customers to achieve digital transformation.
With the advancement of the Hongmeng system, Huawei has repeatedly emphasized that what Hongmeng wants to achieve is the "Internet of Everything", and it is meaningless to be reticent.
Since the official release of the Hongmeng system, Huawei's two most important strategic directions on the terminal side are the 1+8+N all-scenario intelligent strategy on hardware, which opens up the gap between hardware with system-level distributed capabilities, and the other is to build the HMS ecosystem of the third pole of the mobile world, through HMS applications, HMS Core, and a wide range of ecological empowerment solutions, to build a strong application development ecology and continue to promote the innovation of software systems.
If Hongmeng wants to be a complete system, it needs to aggregate more services and link more ecology, and payment is an indispensable part of it. At present, iOS has Apple Pay, Andriod has Google Pay, and Hongmeng naturally has to play its own "payment punch". Therefore, on the surface, it is to create a payment scene, and more importantly, to complete the ecological layout, even if it is not intended to pay, it is still not a smooth road in front of it.
True aggregation has not yet been implemented
In the field of payment, some industry insiders have compared Alipay and WeChat Pay to "gods in the sky" and other payment companies to "spectators on the ground".
However, mortals have the helplessness of mortals, and immortals have the troubles of immortals. Under the mobile payment war, no one can sit back and relax. The hard and soft sides that seem to be opposed are actually not incompatible.
Cooperation is also a trend that has only emerged in recent years. Surprisingly, Apple's iOS system, which has always been closed for safety, announced that it has cooperated with Alipay, which has a "can't beat it and join" attitude. In 2020, Apple Pay officially joined Alipay, which is seen as a harbinger of Apple's "opening up". The landing of the project not only simplifies the use process of Alipay, but also helps appley Pay to localize in China. At present, Huawei Pay has also accessed Alipay and WeChat. Meituan has access to Huawei Pay, Apple Pay and MI Pay.
Although the introduction of the digital yuan is regarded as the biggest rival of Alipay and WeChat, it must not hinder the cooperation between the three parties. According to the "WeChat Pay Smart Life" message, WeChat has supported the use of digital yuan in pilot areas. On the other hand, Alipay also appeared in the digital YUAN APP. This also means that the two major mobile payment platforms have joined the open ecosystem of the digital yuan pilot.
However, although the soft and hard sides seem to be merging, they still have a strong smell of gunpowder in their respective battles.
Previously, after the launch of the payment QR code, "one code and one sweep" was regarded as a "barrier" for different mobile payment platforms. Alipay should scan the QR code of Alipay, and WeChat should scan the QR code of WeChat. It is more normal for the QR codes of several payment institutions in front of the merchant cashier to be arranged in a row.
In the "Financial Technology (FinTech) Development Plan (2019-2021)" released by the central bank in August 2019, it is clearly stated that the interconnection of bar code payments should be realized in 2021, that is, "one code is universal". 2021 has passed, with the launch of aggregate payment, one code multi-purpose has gradually been realized, but it has not yet achieved "one code universal".
This aggregate payment has an upper limit and is currently only aggregating a limited number of payment institutions. Huang Dazhi, a senior researcher at Suning Institute of Finance, pointed out: "Although to a certain extent, this kind of collection QR code is an aggregate payment service provided by an aggregate payment service provider, it cannot be equated with mutual recognition and mutual scanning, 'one code universal'. "And aggregate payment also faces problems such as payment licenses and the security of capital pools." Therefore, there is still a way to go before true interconnection.
Under the impetus of the Ministry of Industry and Information Technology, Taobao and WeChat, which have been blocking each other, have also torn open their mouths. At the beginning of this year, WeChat can directly open the Taobao link, and last month Taobao also launched WeChat Pay. However, at present, WeChat Pay does not support automatic jumping, and users need to take screenshots and manually open WeChat to scan the code in order to pay successfully, and the two are not fully opened.
Filling in the hard-won moat is no longer easy for Ali and Tencent, not to mention the rest of the e-commerce platforms, it is more difficult to access each other's "wallets". On the other hand, the payment systems of current hardware manufacturers are still acting as their respective ecological barriers, and the possibility of interconnection is also small.
The mobile payment space is constantly rumbling, and this may also be a sign of opportunities in the field. In an era of interconnection, it is difficult to distinguish between enemies and friends, although the current mobile payment oligarchy effect is obvious, but the victory or defeat has not yet reached the end.